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The possibility of the American media conglomerate taking over ITV has prompted apprehensions about the effect on British public service broadcasting, a reality that the broadcaster's new chief executive, joining from a high-ranking position at Sky, will be keenly aware of.

Sky’s commercial director, Priya Dogra, will now be tasked to spearhead efforts to oppose her ex-company's takeover plan to safeguard Channel 4.

The proposed merger of Sky and ITV’s terrestrial and streaming assets would leave Channel 4 a significantly weaker competitor in the realm of TV and digital ad sales, reigniting talk of the need to re-examine some form of partnership with the BBC for continued existence.

Foremost Worry: The Future of News

However, it is the possible consequences on the future of news output that are causing the most immediate alarm for many within the television industry.

The unexpected announcement last month that Comcast, which owns assets including Universal Studios and acquired Rupert Murdoch’s Sky for £30bn in 2018, is a logical business move. Traditional broadcasters are facing a long-term existential threat as audiences and revenues continue to rapidly migrate to global digital players such as Meta, Google, Amazon, and Netflix.

“Comcast’s move for ITV is causing nervousness among media watchers, with specific worry for news provision.”

However, the potential £1.6bn takeover of ITV’s television business and streaming service, which would end 70 years of independence, is laden with regulatory, political, and competition concerns.

Immediately, Comcast would control Sky News and ITV News—including its far-reaching regional news operation—and become the biggest shareholder in ITN, which produces news for ITV, Channel 4, and Channel 5.

While Comcast’s 40% stake in ITN would not be a controlling stake—other shareholders include the owner of the Daily Mail, Thomson Reuters, and Informa—it would still be deeply engaged in the news output of most of the main commercial broadcasters.

“If a deal is completed, the fate of ITN is an interesting one that will concentrate attention politically,” says one senior TV executive. “Effectively, they will be involved in the news output of all the biggest non-BBC channels.”

Financial Commitments and Regulatory Scrutiny

Comcast promised to keep funding Sky News for a decade, upping its funding annually in line with inflation, as part of its 2018 takeover of Sky. As that assurance draws closer to expiring, concerns have been raised about whether the US company will continue to fully fund Sky News, which has an annual budget of £100m but is thought to make losses of as much as £80m.

It is believed that any deal to buy ITV would include pledges not to seek permission from media regulator Ofcom to alter the conditions of its public service broadcast licence, which includes obligations to national and regional news.

“There are clearly questions about media diversity,” says Stewart Puvis, a former ITN chief executive. “Theoretically, Comcast could, say, merge Sky and ITV News and use its position as a 40% shareholder in ITN to assert control... I would hope Comcast understand ways of solving these problems.”

A System Under Threat

British TV executives have previously highlighted the risk posed to the UK’s system of public service broadcasters (PSBs) by large parts of the industry being taken over by US corporations.

Recently, Ofcom published a report warning that public service television, such as news provision and UK-focused content, risks becoming an “threatened entity” as viewers migrate to US online platforms and streamers.

The watchdog also revealed data showing that YouTube had exceeded ITV to become the UK’s second most-watched media service, behind only the BBC, with it and Netflix now the two most popular first TV destinations among young people.

Strategic Imperatives

There are those who believe that a Sky takeover of ITV, against the backdrop of the viewer shift to mostly US digital companies, indicates the need for closer collaboration between the UK’s biggest broadcasters.

“The UK requires and deserves its own part of mass media which isn’t US controlled,” says a second broadcasting executive. “It’s a national strategic imperative. I think the government needs to work out how the boards of the PSBs have a new part to their remits that requires them to collaborate.”

Given that advertisers follow eyeballs, a combination of Sky and ITV could create a British TV and streaming powerhouse, with the two companies’ sales houses controlling a dominant share of total ad spend on traditional TV and broadcasters’ streaming services.

Regulatory Hurdles

Any deal will necessitate an investigation by the UK competition watchdog. Sky is hoping the regulator will broaden the definition of the ad market to include the impact of giants like YouTube and Facebook.

“I think it will get passed,” says Alex DeGroote, a media analyst. “Comcast will do everything it can to say it will maintain the PSB status quo... But you don’t buy to ultimately keep everything the same. ITV plus Sky would give them a hugely dominant position in the TV ad market.”

The Precarious Position of Channel 4 and the BBC

Channel 4, which relies on advertising for the vast majority of its income, now faces a weakened BBC as a potential partner and a formidable commercial threat from a combined Sky-ITV.

“We may at some point end up in that situation because of the deep cumulative cuts to the BBC’s funding and because Channel 4, too, has a core budgetary challenge,” says Patrick Barwise, an emeritus professor at London Business School. “Channel 4 has repeatedly outperformed forecasts, but that is just delaying the inevitable. It’s now beginning to run out of road.”

The ongoing saga emphasises a wider dilemma for British media: how to safeguard a domestic voice and a robust public service ecosystem in an increasingly globalised and digitally dominated landscape.